ANGAN LAL Vs. SARAN BEHARI LAL

JUDGEMENT

(1.) One Jagan Prasad, for himself and as the natural guardian of his three sons, two of whom are among the appellants, executed a mortgage bond for Rs. 10,000 in favour of the ancestors of the respondents to this appeal on 17 July 1915. The suit out of which this appeal has arisen was brought to enforce that mortgage One of the sons of Jagan Prasad is dead and is represented in this litigation by his wife, Mt. Manbhari, one of the three appellants.

(2.) Several pleas were taken in defence, but only three of these are pressed before us, and, therefore, need be noticed. The first plea was that the parties agreed that a certain mortgage transaction should be entered into by the parties in satisfaction of not only the bond in suit but also of another mortgage bond, and that being the case, the present suit was not maintainable. The second plea was that there was effected, between the father and the sons a partition in 1911, and, therefore, the present suit for the sale of properties, which fell into the shares of the sons was not maintainable. The third plea was that there was no legal necessity for the loan.

(3.) On the first point the learned Subordinate Judge found that there was, no doubt, an agreement that a fresh transaction of mortgage and a lease should be entered into, but he held that no documents creating the lease or the mortgage having been executed and completed, it was open to the plaintiffs to maintain the suit. The learned Counsel for the appellants has contended that under Section 62, Contract Act, it is enough if there was an "agreement" to substitute a contract, although no contract was completed in the shape of execution and registration of a mortgage and a lease. We are unable to accept this contention of the learned Counsel. In the deed in suit we have a contract and a transfer of property. If this transaction is going to be superseded by a contract, that transaction also must be a complete transaction. It should be a contract which is enforceable in law. The substitution, as we have said, must be by a contract and a mere agreement to execute, in future a usufructuary mortgage-deed and a lease cannot be said to be a contract. To put the same thing in different language, the defendants case is that the bond in suit was to be replaced by a usufructuary mortgage for a sum of Rs. 37,000 which was to be raised under circumstances to Rs. 44, 000. It was further the case of the defendants that there was to be a lease of the mortgaged property in favour of the defendants. These are transactions which can only reach a stage of completed contract on being executed on stamped documents and on being registered. As we read Section 62 there should be an actual substitution of the old contract by a new contract. A mere agreement that there would be in future a substitution would not be sufficient to wipe out the mortgage in suit. "Agree to substitute" is (equivalent) to "agree in substituting". Till the second contract, contemplated, is brought into existence, the old contract will still exist and continue to be enforceable.